Air Transat flight attendants agree to $9 million cost-cutting

Sunwing pilots reach new three-year agreement.

Facing stiff competition in the leisure travel business, Air Transat’s flight attendants have agreed to $9 million in cost-saving measures.

About 1,750 flight attendants, represented by the Canadian Union of Public Employees, voted 66 per cent in favour of the company’s plan, which will reduce the number of flight attendants on Airbus 330 wide-body planes to 10, from the current 11.

“They haven’t touched our salaries,” said Peter Buzzell, president of CUPE’s Air Transat component, in an interview. “Working with one person less, that just means we have to work a little bit harder.”

Other savings will come from having flight attendants stay in cheaper hotels, possibly outside downtown city cores, on the outskirts or closer to the airport, notably in expensive cities such as Paris and Rome.

The overall savings will help Air Transat look at developing a narrow-body fleet of Boeing 737s, which the union believes will allow the company to retain more jobs in the long run.

Transat spokesman Pierre Tessier said Transat asked all union groups, including pilots and mechanics, for $20 million in cost savings. Flight attendants are the first group to approve such a move.

Tessier said the company will do appropriate analysis about adapting business models and make final decisions later.

The company is set to report its first quarter of 2013 results on Thursday, the same day as its annual shareholder meeting.

The $9 million in proposed savings comes on the heels of an agreement last summer, where flight attendants agreed to a three-year deferral of annual wage hikes of 1 per cent, due to begin last November, as well as a lump sum payment of 1.5 per cent.

The company has promised to pay back the money owed by Dec. 15, 2015 at the latest.

Buzzell said Transat is facing competition from Sunwing, which has taken additional aircraft for winter routes, which are flown by foreign pilots.

“With the overcapacity in the market, it becomes a battle of the prices,” he said. “It’s very difficult for the airline industry — it changes the game.

“I’m quite confident that Transat is going to turn this around.”

More competition is expected in the leisure market as Air Canada launches its new discount carrier Rouge in July, targeting European and southern routes similar to those Transat flies.

Meanwhile, the Canadian Auto Workers’ union announced members who are pilots at Sunwing have ratified a new contract by a margin of 78 per cent.

The union represents 155 pilots, and the new agreement will lead to the full-time hiring of 19 Canadian seasonal pilots and upward of 40 to 50 pilots in the next six months, according to CAW transportation director Ron Smith.

But the contract does not apply to foreign pilots who fly for Sunwing, who are paid by their companies overseas. With more direct hiring of pilots, Sunwing can reduce its reliance on foreign pilots, Smith said.

He added that the new contract addresses fatigue issues, hours of work and sick leave. It also includes 2 per cent a year in wage improvements in the three-year contract, plus increases for pilots at the top of the scale.

“We’re a little less than Transat,” he said. “The bargaining committee didn’t want to price themselves out of the market.”

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